Basics of Ppi Payment Protection Insurance

The first thing to understand about PPI is that it is not insurance. Its exactly what it says it is “Payment Protection.”  PPI is a great product and is offered by most all financial institutions. PPI is not insurance in the sense that anyone can offer it without having to obtain a license to sell it. You may be asking what does PPI cover? PPI covers certain life events that may keep you from making your regular monthly payments. This can be due to loss of a job or income, death of a loved one, or a temporary disability due to an injury. Lets face it all of these can be devastating and can cause unforeseen hardships.

This is where PPI comes in. PPI will often cover your monthly payments in the event of loss of employment or a temporary disability due to injury. In the event of a death the unpaid portion owed on a loan such as a car, boat, or motorcycle loan is paid in full. Leaving no unpaid payments and your surviving beneficiary gets to keep the collateral. Of course the types of coverage will vary depending on the financial institution and availability. There are also minimum requirements for most PPI claims. One of which is the six month rule. You have to have the coverage for at least six months before you can be covered by the benefits of the product.

The cost is minimum apposed to the balance of the loan owed. The payments are charged to your account monthly on credit cards and on loans they are pre-calculated into the balance. It is usually based on the amount owed on the loan or credit card. Most creditors will offer this service to you at the time of application. It can be canceled at anytime and can usually be purchased at anytime as well.

PPI offers peace of mind in that it covers you in an unforeseen life event. No one expects to lose a loved one. No one can see loss of employment due to layoffs or other reasons and accidents happen all the time. Why not protect yourself and your family. Many of us  may not qualify for life insurance, but we all qualify for payment protection. A rule to live by is that it often cost more to save then it does to spend. Spend the extra dollar or two it takes to ensure you and your family are protected.